Deezer, French Music Streaming Service, Postpones I.P.O.

The struggling market for initial public offerings just claimed another victim.

Deezer, the French music streaming service, withdrew its I.P.O. on Tuesday, blaming tough market conditions.

It is a setback for Deezer, a Paris-based rival to Spotify and Apple, which wanted to use the $330 million it had expected to raise from the offering to fend off competitors in the music-streaming industry. The planned offering was expected to have valued the company at roughly $1.1 billion.

The postponed public listing on the Paris bourse — Deezer said it was reviewing its funding options — is also the latest failed attempt by a company to tap the global public markets where confidence has been sapped by a number of global shocks, including a downturn in China and weak growth in Europe. The luxury retailer Neiman Marcus and Albertsons, the supermarket chain, for example, have recently delayed their public offerings.

For Deezer, which has about six million paying subscribers in 180 countries, compared with Spotify’s 20 million paying users, investor appetite also was hit by a number of recent weak earning reports by other media-streaming services, including Netflix and Pandora, according to a person with knowledge of the matter, who spoke on the condition because he was not authorized to speak publicly.

These earnings had raised questions for investors over whether the French music-streaming company would be able to weather the current instability in the world’s financial markets, he added.

This month, Netflix said that its third-quarter profit fell 50 percent from the period a year ago, as the company reported worse-than-expected streaming growth in the United States.

Pandora, the Internet radio service, also suffered a 35 percent one-day drop in its share price on Oct. 23 after it downgraded its financial guidance for the rest of the year, in part because of strong competition from the likes of Apple.

While Deezer was forced to postpone its public offering, the company must still compete with deep-pocketed rivals like Spotify just as interest in music-streaming services is picking up. Spotify, based in Stockholm, has raised over a billion dollars from private investors to value the company at more than $8 billion.

Deezer generates roughly half its revenue from its domestic French market, while the rest of Western Europe represents the company’s second-largest region by number of paying subscribers, Hans-Holger Albrecht, the company’s chief executive, recently told DealBook.

Developing countries in places like Latin America also constitute a large percentage of Deezer’s business, he added. In contrast, the United States remains Spotify’s largest market, where it also competes against companies like Pandora.

In many countries, particularly those in emerging markets, Deezer has expanded rapidly through partnerships with local telecommunications operators that have bundled Deezer’s music service with monthly cellphone packages.

While such partnerships have increased the number of overall users, analysts say such deals do not generate the same level of revenue compared with selling subscriptions directly to potential customers.